Rescue workers in Bangladesh have called off their search for survivors of a devastating fire that tore through apartment blocks in central Dhaka overnight.

The death toll stands at between 92 and 150 according to local journalists. It is likely to rise as more bodies are pulled from the smoking remains of the old residential buildings and shops in the Najrabazaar quarter of the city where the fire started at around 9pm yesterday.

Most of the casualties who died were trapped inside the crowded tenement blocks. The bodies were laid out along the roadside awaiting transportation to overflowing city morgues.

At least 200 people have been injured, many seriously.

A woman mourns her brother who died in an apartment block fire in Dhaka. Photograph: Andrew Biraj/Reuters

"I have never had such a harrowing experience in all my 40 years here," said Shamanta Lal Sen, head of the burns unit of the Dhaka Medical College Hospital, amid chaotic scenes as relatives of the missing searched for loved ones.

The exact origin of the blaze is unclear. The local Daily Star newspaper reported that it may have started in a bakery before spreading to two electricity transformers or may have followed a blast in the transformers. The fire is believed to have been intensified by illegally stored chemicals.

Witnesses told the newspaper they had heard an explosion and then saw flames engulfing the houses.

"With power supply snapped, it looked like a hell on earth. All I could hear were shrill cries coming out from every direction," said Rahima Begum, who spoke to the Daily Star – she was feeding her child when the fire broke out. Fire official Nazrul Islam said he believed a fault with the transformer was the cause of the disaster, the worst fire in memory in the city.

"It has caused huge devastation," he said.

The victims included guests at a wedding party on the roof of one of the building.

Rescue workers were criticised for their slow response but blamed the complexity of the fire and the narrow lanes of the neighbourhood.

The prime minister of Bangladesh, Sheikh Hasina, expressed her shock over the incident and sent condolences to the families of the victims. The government has ordered an investigation.

Dhaka is one of the most overcrowded cities in the world with a population of 13 million and only rudimentary emergency services.